Projects on Polkadot can bring tremendous returns for investors, according to trader Elliot Wainman
Renowned analyst Elliot Wainman says some upcoming low-cap projects could skyrocket in value thanks to their connection to the Polkadot (DOT) ecosystem.
Wainman speak With 327,000 subscribers to his YouTube channel, he is betting on projects that will win the Polkadot Parachain.
Polkadot, founded by Ethereum co-founder Gavin Wood, is a relay chain that does not support smart contracts. Instead, it ensures the smart contract functionality through additional blockchains (parachains) that are plugged into the relay chain. Only 100 parachain slots (positions) are available in the relay chain. So there is tough competition to win a slot.
“It takes tens of millions of dollars to have your own parachain and win a parachain auction through crowdlending. Not only are these extremely expensive and hard to come by, but even if you have money, you are unlikely to get 1 slot. You have to compete for a very limited number of slots. This means that the projects that win the crowd loan and parachain auction will benefit from the big pumps as they have a protective shield. Other projects not only build on Polkadot, but also have to go through this process. “
Acala, Polkadot’s “DeFi Hub”, is the first to win one of the parachains, according to the analyst. Acala is working on the Polkadot testnet, but Acala’s governance token will not be launched until the project acquires a Parachain slot.
Wainman also mentions another groundbreaking company as “Acala’s cousin” called Karura, which is the “all-in-one DeFi hub” for Kusama, a sandbox for Polkadot projects. Karura will also launch a KAR token when given Parachain options.
The dealer also noted that the Phala Network (PHA) is in a “first position” to receive a parachain. This private coin project is awarded a parachain in the testnet. At press time, PHA is trading at $ 1.05, according to CoinGecko.
Also on Wainman’s list is Moonbeam, an upcoming Smart Contract Parachain on Polkadot. Moonbeam tokens will also be introduced.
According to Dailyhodl